A Critical Appraisal of Strategic Action Plans Essay Example

that it would be better for him and Silver Lake Partners to become equity holders rather than having public stockholders. The investor presentation supports the arguments made by Dell directors who supported the buyout, marking Mr. Dell's first independent presentation of his case. A source familiar with the situation disclosed that Mr. Dell shared the investor presentation as he has a meeting scheduled with Institutional Shareholder Services, an organization that advises stockholders on voting for deals and other corporate matters.

According to experts in shareholder discussions, the approval or rejection of the Dell buyout may ultimately depend on ISS's recommendation. A source familiar with Mr. Dell's plans reveals that he intends to personally meet with Dell stockholders soon to present his case. This move emphasizes the high stakes for Mr. Dell as he risks a portion of his personal wealth and his reputation as an innovative technology entrepreneur. He has committed $4.5 billion of his own cash and Dell stock towards the proposed buyout. However, investor Carl Icahn and certain other Dell stockholders strongly oppose it.

Critics argue that Mr. Dell is exploiting his company's decline by acquiring it at a reduced price, while Mr. Icahn opposes this view and accuses Mr. Dell of pursuing his own interests. During an interview on Friday, he poses a straightforward question: If the company is performing so poorly, why does Mr. Dell have such strong determination to possess it? Some investors who have held shares for a long time contend that their investments have contributed to Dell's expansion into new areas like computing storage and software. They also assert that the buyout agreement prevents them from

benefiting if these ventures prove successful.

Mr. Dell expresses concern over the discomfort that both employees and customers may face if Dell remains a publicly traded company and experiences further stock market declines. He emphasizes that customer welfare is his top priority. If shareholders approve the buyout agreement on July 18, Mr. Dell will hold a majority ownership of Dell's stock, which will provide him with increased control over the company and its strategy.

Mr. Dell and his affiliates own around 16% of Dell's publicly traded shares. It is unclear if Mr. Dell's argument will persuade investors who believe they were treated unfairly in the buyout. Some investors have been contacted by advisors employed by Dell directors, urging them to vote for the buyout. They will also soon receive communication from Mr. Dell and Mr. Icahn. Recently, Mr. Icahn proposed that Dell should remain a public company and use borrowed funds to repurchase stock worth up to $16 billion.

Despite opposition from Mr. Dell and ongoing pressure from Mr. Icahn, those familiar with discussions believe that majority support for the buyout can still be secured among Dell shareholders. On Friday, Dell shares closed at $13.35 per share, just 1 cent lower than before. This price is still below the agreed-upon deal price of $13.65 per share, suggesting market participants' confidence in the approval of the buyout during next month's shareholder vote.

The presentation discussed Mr. Dell's opposition to borrowing money and keeping some Dell shares publicly traded, a transaction that Mr. Icahn supports. According to Mr. Dell, adding significant debt while remaining a public company would limit its financial flexibility and

weaken its ability to withstand economic or business downturns. Observers have raised concerns about whether Mr. Dell would still want to be CEO if shareholders reject his buyout proposal. However, in the presentation, Mr. Dell affirmed his dedication to continuing his best efforts for the company even if the vote goes against him.